Monday, July 26, 2021

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Pot cultivation in Williams could add millions to city coffers

The Williams City Council held a special meeting last week to introduce a development agreement for the first outdoor commercial cannabis operation planned within city limits.

The council set a public hearing for April 21 for final consideration of the agreement.

The project has been in the works for months, and officials estimate that city coffers from the new agriculture crop could grow by more than $5 million over the next seven years.

The special meeting accelerated the development process by about 30 days, which will allow cannabis grower Marcos Guizar, of Williams Horticulture, to get a crop into production by June.

“It’s helping our team tremendously,” said Guizar, about the city’s willingness to cut about 30 days off the process by holding a special meeting.

Guizar plans to grow the marijuana in containers inside semi-permanent structures called “hoop houses,” which will keep the company’s initial investment low, compared to having to build modern, high-tech permanent structures.

The project will include planting, growing, cultivating, harvesting, process, drying, trimming, extracting, and manufacturing marijuana and marijuana-related products for distribution, although the agreement does not allow for a retail establishment to sell marijuana or related products directly to the public.

Outdoor cannabis facilities have been allowed in Williams since Jan. 20, when the City Council approved an overlay zone on property located north of the wastewater treatment plant on Freshwater Road.

The development agreement is between the City of Williams, two Williams landowners, and Williams Horticulture.

Williams Horticulture has leased about 20 acres from the two property owners to get the business up and running by summer.

The development agreement calls for cannabis operation fees to be paid to the City of Williams based on the square footage of the cannabis grow as opposed to the company’s gross sales.

The City of Williams set the fee at $2.75 per square foot for straight cultivation of marijuana and $3.50 for manufacturing and processing. The agreement also sets $3 per square foot for other land uses, such as offices.

“Whatever they are doing, there are different levels of fees,” said City Administrator Frank Kennedy.

Williams Horticulture anticipates the first grow to be about six acres total, which would bring about $750,000 per year into the city’s General Fund, officials said. The company hopes to quickly expand operations to 10 acres, which will mean about $1.3 million per year for the city.

The development agreement is for seven years, and can be renewed, officials said.

Kennedy said Williams currently does not allow direct retail sales of marijuana, and Williams Horticulture has no plans for direct distribution, although local delivery of marijuana-based on online sales is permitted by the state.

City officials anticipate inspecting the pot farm every quarter, largely to see if usage areas increase or decrease.

“They will be paying upfront at the start of each quarter,” Kennedy said.

Although city officials said they hope the company’s cannabis business is very successful, the city did not tie their fees to the company’s gross receipts simply to make the process easier and possibly more profitable for the city.

The development agreement, however, does not allow for testing facilities, as the state requires independent testing by other licensed sources.

While the Williams Police Department will inspect the facility for security, city officials said they will mostly stay out of the company’s businesses, as cannabis is highly regulated by the state.

Although the company plans cannabis activities year-round, the primary growing season for marijuana is June through September, with harvesting in October, Guizar said.

While residents can expect some marijuana odors coming from the property on occasion, city officials said cannabis is legal in California and should be treated as any other agriculture crop.

“It’s (in) the perfect place; it’s right next to the sewage treatment plant,” Kennedy said.

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